02. I Had to Fire the Contractor…

Everything Is Great Until It’s Not

Oh, the VERY reason I didn’t want to start flipping houses. The very reason I was afraid to pull the trigger. The very thing I thought I had prepared for happened. I realized I had not prepared for it to the extent that I had thought. It will surely change how I do business moving forward.

As Rachel Hollis said in, “Girl, Stop Apologizing,” when you are working towards a goal, nothing is happening, nothing is happening, nothing is happening, and then HOLY CRAP! Everything starts happening! (not a direct quote, but you get the idea. She’s quite literally my hero right now). Well, that’s where I thought things were finally going but in reality, we hit a HUGE snag.

The Most Important Thing in Any Business Venture

You know the one thing they don’t tell ya about this starting a house buying company in Maryland? Or any business for that matter. Your mindset is THE most important thing. It’s even more important than knowledge and experience if you can believe it. Without the right mindset, you will give up before you see your goals come to fruition. The road less traveled is rarely easy but it’s almost always worth it to push through and see it to the end.

My mindset when I first started a We Buy Houses in Maryland company? It was total garbage. I mean, it wasn’t the worst that it had ever been but honestly, I was not in a good place when I decided to leave my career to pursue real estate full-time. I just knew that staying in that career was going to put me in an even worse place mentally than I already was. And well… that just couldn’t be. I was done living my life for other people or doing it the way other people expected me to. I had followed so many of the rules to get where I was but still, I found myself utterly miserable. I felt duped!

Why This Property?

So, here we are now, in the middle of January in the year 2020. I’m on the cusp of completing my first flip of 2020. Or well, I thought I was a couple of weeks ago. I bought the property about a month ago. A quaint, 2 bed, 1 bath house near the park. To be honest, I spent more than I wanted to but given the location and nature of the beast, it felt as good as any to take the plunge and move forward.

What a stressful time to buy an investment property in Baltimore City! Over the holidays, competing with potentially bad weather. This one was supposed to our first full gut rehab in Baltimore City of 2020. It’s in a great area and it’s also very tiny so I felt more comfortable taking on a major project such as this.

The HUGE Snag and Picking Up the Pieces

Well, within just a few short weeks, I had to fire the contractor. Yes indeed! I trusted him and he’s completely screwed me over. We’re in the middle of making amends but there are no more second chances at this point with him. Who knows if he’ll even pull through and do what he says?

Earlier last week I felt relieved that I could finally move on and find quality people to work on this project. I’m not sure how much the rehab will cost because who knows where the last contractor got his numbers and how accurate they are. I know several major items were missing from the repair budget, such as an allowance for stairs and painting the exterior walls.

Why I’m Moving On

Last week, I called a guy who had been referred to me to do a trash out. This guy went over there the same day and quoted me a fair price. The very next day he trashed out most of the property and sent me pictures and he will be finishing the next business day. What?! You mean to tell me, someone did a trash-out of the property in two days when the person I had originally hired couldn’t get it done in over 21? Oh, buddy, I am not happy about this.

I told the prior contractor that THIS is how things are supposed to move. There is no excuse for the property to have been in the state that it was still. He put me at risk of code violations with the amount of trash and debris sitting in the backyard.

Every time I turned around, he had an excuse for something or would say, “Oh, first-timers…” No buddy, that’s not how we do business around here. Oh, and please, for the love of everything in this world, please stop calling me “Boss.” If your contractor refers to you as “Boss” please run, do not walk, in the other direction. Of course, that is not a hard and fast rule but man, did it ever rub me the wrong way.

How I’m Able to Break Our Contract (Are. You. Kidding. Me. Right. Now?!)

Well, really and truly, the contractor breached the contract. It’s almost laughable now, but just a few short days before I fired the contractor, can you believe he dared to say another deposit would be needed this week? Hahaha, oh good times my friend, good times. So, let me ask you this, where is all the money I’ve already given you? I surely don’t see that in this property… and you surely did not do everything in Phase 1 to even begin to be asking for a 2nd draw. You’ve got balls my friend… I am not the only person you’ve screwed over as of late so we’ll see how this all unfolds.

For my project, no plans were drawn up. Only one somewhat bogus building permit had been pulled. A second one was pulled but only over two weeks after he was first able to do so. No permits pulled for electrical work or just about anything else that is needed.

The work that was done on the property is not up to code. The framing… oh, the framing… screwed into loose bricks, doesn’t reach the floor joists, doesn’t allow for insulation where it is required by code. I mean, I just can’t.

Don’t even get me started on the electrical… oh, the electrical. It seemed to be going ok with that, even though permits had still yet to be pulled… right!? Anyway, well, the subcontractor the general contractor hired did not do it up to code nor did he pay the subcontractor even for the work that had been done correctly. So, what did that subcontractor do? Oh, he came and destroyed all of the work he did. I just don’t have time for these games! Nor does anyone else!

Where Do We Go From Here?

Early this week, I met with the listing agent and designer to go over plans. They both said how they thought things would be farther along at this point. Truth be told, so did I. I got a little teary-eyed, mainly because at the time I just didn’t know how much this project is truly going to cost. I still don’t but hope to find out this week.

Then get those plans drawn up and approved. Then bids for the work. Then work commences. Next time I buy a property I’m demanding access to it. All of this could have been done while it was under contract.

Thus far I’ve had three contractors come through. The first came highly recommended, but I got a bad feeling from them. In asking around, they were way overpriced it seems as well. The second I rather liked, he took measurements and seemed to know what he was talking about. Also, my gut didn’t give off any warning sirens when he came through. You can’t make decisions based solely on your gut, but I am learning to trust my gut a bit more, particularly if there is hard evidence in front of me. To be honest, my gut was blaring warning sirens about the contractor I originally hired but I chalked it up to it being the first time I was working with him. I’ll learn to listen to or at least consider my gut reaction in the future. Well, I rather liked the second guy and will likely go with him.

I’m just concerned about what this whole renovation is going to cost because at this point just about anything and everything the prior contractor did was a complete and utter joke.

*sigh* I’ve cried and lost sleep over it. Trying to pick up the pieces and move on best we can at this point. Figuring out where the additional money for living expenses and rehab costs will come from until we can see this baby through to being sold is weighing heavy on us right now.

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